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2011 Financial statements released by AFP - Video and Multimedia as growth stimulants

THIS WEDNESDAY, MAY 2, AFP’S MANAGEMENT BOARD APPROVED THE FINANCIAL STATEMENTS FOR FINANCIAL YEAR 2011.

02May2012

Sales came to 281.4 ml €, a 1.2 ml € increase over budget and a slight rise by comparison with 2010 on the basis of a constant consolidation perimeter. These figures represent a good commercial performance in spite of national and international recessionary conditions.

The operating margin behaved well, despite a particularly dense flow of news from Japan, North Africa and the Middle East, with “Arab springs” taking place all year and entailing substantial additional costs for coverage. That margin is almost the same as the one for the 2011 budget and slightly less than the latter after neutralizing exchange effects (a difference of 1.4 ml €).

The group’s net income is positive for the 6th straight year, at 0.4 ml €.

The posted performance – an operating margin of 15 ml € and positive net income – confirms the efforts in connection with commercial prospecting and cost control made all year long, amidst a very active international news scene. That performance results from the efforts made by all, the regions spared by the flow of news having contributed to offsetting, in part, the additional coverage costs arising in the Middle East or in Africa. Receipts, on their part, stabilized thanks to increased international sales and receipts from the State convention, offsetting a reduction of income from French customers, which were hit hard by the crisis. They also benefited from the first year of full-fledged activity of our wholly-owned subsidiary AFP-Services, which posted 2 ml € in sales in the photographic and video-on-demand segment.

The year 2011 also made it possible to continue implementation of the Agency’s strategy, focusing on video and multimedia development, while continuing to invest in its traditional types of production in spite of the national and international economic situation. The Agency now turns out 150 to 200 videos per day in 7 languages, representing a doubling in one year. That increase enabled AFP to acquire a foothold on the television market and to count CBS, the BBC as well as Skynews among its customers. In 2011, income from video rose by almost 20%. Income from multimedia is increasing sharply, adding almost a million euros in additional sales for the Agency every year. The offering became more diverse, with the launch of products for smartphones and tablets, SMS alert services for the cellphone operators, and multimedia products adapted to the public screens. Finally, the Agency asserted its presence in the social networks, with Facebook pages totaling almost 60 000 fans and the opening of several AFP Twitter accounts. In addition, a guide to participation in the social networks was distributed to the Agency’s journalists.

Resources were made available for applying this strategy, and altogether 38 new positions were created in 2011 – mainly by redeployment – to increase our multimedia and video production volumes. Those creations also made it possible to do away with the use of temporaries, which had existed for many years in the company, and to reorganize AFP’s presence in the Ile-de-France region.

At the same time, the Agency continued with its investment program marked by two strategic focuses: the “IRIS” project for multimedia production and distribution representing an amount of 9.2 ml € in 2011 as well as the Head Office work in an amount of on the order of 5.2 ml €, including the design work for the entire building on Place de la Bourse, infrastructure work and 3rd floor renovation.

The initial months of 2012 have brought an operating margin in line with budgetary forecasts. They also witnessed the conclusion of the parliamentary work aimed at guaranteeing the permanence of the public financing received by AFP. The fact is that article 100 of law No. 2012-387 of 22 March 2012 modified article 13 of the Agency’s Articles so as to allow “financial offsetting by the State of the net costs generated by performance of its general interest assignments, as defined in articles 1 and 2 of the present law”. With respect to the editorial and commercial domains, 2012 will be a sports year for AFP, with two events – the Olympic Games in London and the European Football Championships – which will challenge the journalists, and renewal of our sports offering in the 2nd half of the year.

Finally, Emmanuel Hoog paid homage to Jean-Pierre Caillard, President of the La Montagne - Centre France group and Deputy Chairman of the Agency’s management board, who died last March 21. Mr. Caillard will be replaced by Mr. Pierre Gironde, Director of Editorial Staffs of the group La Montagne – Centre France. Mr. Alain Plombat, Chairman of the Executive Board of the Journaux du Midi, will succeed Mr. Caillard as Deputy Chairman of the management board.

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